More than 40,000 Viettel employees participated in its Mobile Money pilot. (Photo courtesy of Viettel) However,mobile payments need to be implemented soon to reduce the disparitybetween urban and rural areas. They can also be an effective paymentchannel in supporting people in remote and isolated areas.
NguyenThu Hien in Hanoi’s Hoang Mai district has become familiar with onlineshopping, payment and home delivery since the start of the pandemic.
Shereceives her goods after being disinfected at a reception desk in herbuilding, while having no face-to-face contact with delivery men.
Hientold Vietnam News that onlineshopping helped her save time and reduced the risk of infectioncompared to cash payment. In addition, onlinepayments are convenient when paying large amounts.
“Inthe context of COVID-19, I get a lot of promotion codes from sellers incooperation with payment units such as charge-free payments, cashback andprice reduction. This helps me save a considerable amount when shoppingonline,” she said.
Inaddition to online shopping, people can also pay for their electricity, water,telecoms and even hospital fees through banking accounts or e-wallets.
CanVan Luc, a banking and finance expert, said since the outbreak of COVID-19 inearly 2020, the number and value of transactions through non-cash paymentmethods have increased sharply compared to the previous period.
Inthe first half of 2021, non-cash payments increased by 30-40 percent intransactions and by 70-80 percent in value.
Despitethe sharp increase, it was undeniable that cash payments were still popular in Vietnambecause consumption habits as well as payment coverage had not reached ruraland remote areas, Luc said.
Citingdata from FIS Global Payment, he said that in Vietnam, cash payment methods ine-commerce still accounted for the highest rate at 28 percent, followed bymoney transfers at 26 percent, e-wallets 21 percent and credit cards 14 percent.
Meanwhile,worldwide, payments via e-wallet accounted for the largest proportion at 44.5 percent,followed by credit cards with 22.8 percent.
Theuse of cash as a popular payment method in Vietnam was considered both achallenge and an opportunity for involved parties, he said.
Accordingto Nguyen Minh Tam, deputy general director of Sacombank, there is stillplenty of room for cashless payment. The number of payment accounts in Vietnamis currently over 100 million.
However,people often open a bank account just to withdraw cash via the ATM. Smallbusiness households and traders as well as customers still mainly pay in cash.
TheGovernment in March approved pilot application for Mobile Money, whichallows the use of mobile-phone credit to pay for small-value goods and services.
Thepilot application for mobile money services aims to contribute to thedevelopment of non-cash payments, improving the access and use of financialservices, especially in rural, remote, border and island areas.
Viettel,VNPT and MobiFone are the three telecom operators that submitted applicationsfor a pilot licence to deploy Mobile Money. However, more than five monthssince issuing the decision, Mobile Money has not been implemented, largely dueto the prolonged impact of COVID-19.
Ata forum on developing non-cash payments recently held by the International DataGroup, Pham Minh Tu, deputy director of MobiFone Digital Service Centre, saidthat MobiFone was still in the process of completing procedures and applyingfor a licence to launch the product.
MobileMoney targets unbanked customers. Based on the advantage of widespread networksin remote areas, telecom providers could fill the gaps that banks have not yetpenetrated.
Tusaid there was still much room for the development of cashless payment in Vietnam,but it would be rocky. Cashless transactions are currently concentrated mainlyin urban areas.
Meanwhilein rural areas, which account for about 60 percent of the population, non-cashpayment has not been popular, leaving room for development.
Accordingto Tu, if Mobile Money is exploited, it would make a change and upgradesociety, reducing the gap between urban and rural areas. People in rural areascould sell their products through payment tools and e-commerce.
However,experts have also said the development of Mobile Money or non-cash paymentmethods in Vietnam still faces many challenges. The most important thingnow is to change people's consumption habits through financial educationprogrammes as a pillar in implementing a comprehensive financial developmentstrategy.
Onthe other hand, the Government also needs to complete the legal corridor forthe digital economy and government, including digital finance.
Inaddition, it is necessary to continue to upgrade the information technologysystem and digital infrastructure in remote areas, raise awareness and increaseconsumer confidence.
TheGovernment also needs to develop an open banking system with stronger cooperationamong commercial banks, Fintech and payment intermediaries./.
VNA
